On February 4th, I wrote on the American Medical Association’s (AMA) role in modern medicine. Today I will give further commentary regarding the AMA by reviewing a seminal paper by Reuben Kessel (1958). The paper describing the AMA’s development in the first half of the twentieth century. The AMA has two main goals: 1) a […]

During the past few days, I have written extensively on the reasoning behind why society would wish to create a licensing arrangement for some professions. Today, I will review Hayne Leland’s 1979 paper which develops a mathematical model which explicitly describes the welfare implications of licensure. Model Leland uses a Akerlof style set-up where the […]

Another example of how physician licensure affects earnings is a paper by Keith Leffler. In the paper, Leffler looks at the different states who accepted and refused to accept the Federal Licensing Exam (FLEX) in the late 1960s. Leffler proposes that if physicians acted as a cartel, only states with lenient state examinations would accept […]

What is the purpose for licensing physicians? For the general public, the answer seems obvious: society must prevent individuals from consuming low-quality health care. From the economist’s point of view, this reasoning is not very compelling. If individuals are looking out for their own best interests, it would be illogical for them to consume low-quality medical care […]

Most economists believe preferences are monotonic. This means that economic researchers believe the more of something you have (e.g.: money, burritos, cars, friends, etc.) the more well-off you become. This assumption likely holds if we view health as an argument in a person’s utility function; more health generally makes people better off. Putting ‘medical services’ […]

When traveling from San Diego to Milwaukee for Thanksgiving, my flight was delayed two hours. While this was an inconvenience, it did provide me with the opportunity to finish the book Capitalism and Freedom by Milton Friedman. The book espouses a libertarian point of view; this point of view is one which is currently held […]

What is do be done regarding the long waits for those needing a donated organ to save their life? As expected, economists recommend market creation as the solution. Freakonomics authors Stephen J. Dubner and Steven D. Levitt argue in the New York Times (“Flesh Trade“) that the creation of a market for organs makes sense. […]